Ground rent is acceptable up to 0.2% or £2,000 whichever is the lower of the property value. Please note, if however, the ground rent is over £250 (or £1,000 in London) or will end up over these figures in the future, under the Housing Act 1988 they are treated as “Assured Tenancies”. This means that if the ground rent falls more than 3 months into arrears a landlord has a mandatory ground for an order for possession. In order to proceed we will require a Deed of variation prior to completion.
A service charge together with ground rent is allowable up to 1.5% p.a. of the property value based on the valuer/AVM valuation
Where the Ground rent or service charge increases by more than CPI or RPI or the review period for ground rent is more frequent than every 10 years, applications will not be acceptable